What age does car insurance go down?

When you turn 25, you’ll notice a drop in your insurance premium.

Car insurance companies calculate premiums based on how much of a risk that driver is. Therefore, new drivers, regardless of their age are perceived as high risk with a likelihood of getting in an accident, which as a result increases the premium.

How car insurance rates are set 

Car insurance companies will want to know a few basic information when you apply for a policy. That information includes:

• Your driving record
• Age 
• Credit History 
• Car make and model 
• Your location
• How often you’ll drive the car

Your insurance provider will ask you to provide this information because it’ll help them calculate how much of a risk you are to insure. As a result, your premium will be calculated based on those components. Sometimes car insurance companies get too stereotypical resulting in high premiums. Unfair, right? Have you heard of usage-based insurance? If you are a firm believer in your driving skills and lack of accidents then you should check it out!

Essentially that’s how insurance works. The way you drive determines your insurance rates. What car insurance providers do is, they collect your driving history along with your age to determine the likelihood of you getting in a crash. That’s why new drivers tend to pay higher premiums than experienced drivers. Read more on car insurance rates for new drivers. 

When your car insurance rates drop 

Generally, all insurance providers drastically decrease premiums when drivers turn 25. However, that applies to drivers who turn 25, with a good driving history. As mentioned previously, accidents tend to boost your premiums for a couple of years. Therefore, if you’ve had a clean driving record, you’ll notice a decrease in your premium even before turning 25.

You can expect your insurance premium to decrease continuously up until approximately the age of 65. However, that rule doesn’t just apply to age. Factors that may contribute to your premium include your car, how often you’ll be driving, your neighbourhood, and other factors that summarise how much of a risk you would be to insure. 

Other ways to save on car insurance 

The best way to save on car insurance and one of the most efficient ways is to compare car insurance quotes from different providers. Have a range of companies with their quotes for you to understand which one would suit you best and help you save money in the long run.